Excela Health System plans to remain a community-based health system with its three hospitals in Westmoreland County and will not take sides between Highmark Inc. and UPMC, an Excela executive said Wednesday.
Michael D. Busch, executive vice president and chief operating officer, told reporters that Excela — with its hospitals in Greensburg, Latrobe and Mt. Pleasant — wants to focus on community-based care and does not want to be part of a larger health delivery system.
Excela wants to work collaboratively with both Highmark and UPMC, which it does through its cancer center at Mountain View with UPMC, Busch said.
Excela has talked with Highmark about working together to reduce health care costs, Busch said.
Busch said he was hopeful that Highmark will have "a completely different view" when its new chief executive, William Winkenwerder, takes over next month. Highmark fired former CEO Kenneth Melani two months ago after he was charged with assault and trespassing for fighting with the husband of his mistress -- as Highmark was pursuing a takeover of the West Penn Allegheny Health System. Prosecutors withdrew all criminal charges yesterday against Melani, who completed a series of anger-management sessions.
"Let's solve the problem (of health care costs) as opposed to you trying to own everybody," Busch said.
Highmark has had discussions with hospitals to build an integrated health care delivery system for the region and has had discussions with physicians to affiliate with them, Highmark spokesman Michael H. Weinstein said. Highmark is interested in keeping quality care local and reducing costs, he said.
In the current economic environment for health care, when Medicare reimbursements do not cover costs of providing care, Excela expects to break even for the fiscal year that ends June 30, Busch said.
For the 2010-11 fiscal year, the system generated $500 million in revenue, with net income of $1.3 million, which Busch called "essentially break even." Excela has 200 days of "cash on hand" to cover operating costs.
Excela could increase revenue and add 1,000 employees to its 4,800-member workforce if it could serve the 40 percent of the community that leaves Westmoreland County for health care, Busch said. Of them, 50 percent go to Pittsburgh, he said.
Excela is working to recruit more physicians and improve patient experience to try to encourage community members to seek local care, Busch said.
"About 80 percent of the things (for which patients are leaving the county) are things we do very well," Busch said.
Last week, Excela took a step to keep more patients within its system by acquiring the Norwin Hills Shopping Center in North Huntingdon so that it can expand services in the western end of the county, Busch said.
Excela has been operating the Excela Square at Norwin medical facility at the shopping center and will add physician offices and more services, he said.
The first phase of the expansion will cost $9.5 million, which includes costly imaging equipment. Laboratory facilities and diagnostic imaging services will be opening next week at the center, and physician offices will be added in a second phase in January, Busch said. The facility will offer female patients one-stop breast care, from mammograms to radiology to appointments with a general surgeon, Busch said.
Excela made its intentions known when it closed the former Jeannette District Memorial Hospital in January 2011 and presented plans for the expansion to North Huntingdon officials last year. Excela acquired the former Norwin Medical Commons when it purchased Mercy Jeannette Hospital in 2008.
Excela did not acquire the shopping center in response to UPMC building a new hospital in Monroeville, less than a mile from Forbes Regional Health Center, Busch said.
